Bitcoin steeped less than $36,000 between broader market sell-off

May 10, 2022: On Friday, Bitcoin continued to crater after an intense stock sell-off in the U.S. spooked the cryptocurrency market on Thursday.

The selling of cryptocurrency was sparked by a painful day on Wall Street where the Dow Jones Industrial Average lost over 1,000 points on Thursday, marking its worst single-day came down since 2020.

The tech-heavy Nasdaq decreased by almost 5%. Bitcoin remains correlated to equity markets, with the cryptocurrency increasing or decreasing with stocks.

“Overall, global markets have been spooked by improving fears, as we can see. The Dow had its worst drop since 2020. All related risk-based assets followed suit, including crypto,” Vijay Ayyar, vice president of corporate development and international at crypto exchange Luno, told CNBC.

On Wednesday, the U.S. Federal Reserve boosted its benchmark interest rate by half a percent. Further interest rate walks and tightening of monetary policy have sparked fears that the U.S. economy could go into recession.

Ayyar said that bitcoin “lost a key level” when it fell below $37,500, indicating “a move much lower” in the arriving few days. He said bitcoin could test a low of $30,000 soon, and if the price slips below that, it could drop to $25,000.

“Nevertheless, we could see some relief rallies in the meanwhile, but nothing to indicate a change in sentiment” unless bitcoin can find market support above $42,000, Ayyar added.